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What to Make of the FDA's Latest Warning to AbbVie and Pfizer

By Keith Speights and Brian Orelli, PhD – Dec 18, 2021 at 6:55AM

Key Points

  • The FDA placed additional warnings on AbbVie's Rinvoq and Pfizer's Xeljanz.
  • Xeljanz received a tougher warning than Rinvoq did.
  • The worst-case scenario is that the FDA opts to restrict higher doses of the two JAK inhibitors.

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There's still a worst-case scenario that the FDA could unleash.

The U.S. Food and Drug Administration (FDA) has placed additional warnings on the labels for JAK inhibitors marketed by AbbVie (ABBV -0.05%) and Pfizer (PFE 0.32%). In this Motley Fool Live video recorded on Dec. 8, 2021, Motley Fool contributors Keith Speights and Brian Orelli talk about what to make of the FDA's latest warnings.

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Keith Speights: We talked earlier about some news about JAK inhibitors. The FDA has slapped additional warnings on AbbVie's JAK inhibitor, Rinvoq, and Pfizer's JAK inhibitor, Xeljanz.

What might the impact of these warnings be for the sales of these drugs? And do you think the worst is over as far as the FDA is concerned, or could more bad news be on the way?

Brian Orelli: This is definitely a huge deal. I'm not sure the warning labels in and of themselves were that big of a deal since it was already known, and obviously, AbbVie was hoping that it wouldn't get a warning label since it was only the issues we're only seeing with Pfizer's Xeljanz. But the FDA has signaled that it believes it's a class effect and so they -- it seems likely that AbbVie's Rinvoq was going to get a warning label, too.

AbbVie's warning labels are, for lack of a better word, softer than Pfizer, which got a black-box warning. The bigger deal, I think, is that FDA updated the indication, and so now, Rinvoq is only recommended after treatment with a TNF blocker, where before it could be used as a frontline treatment.

The JAK inhibitors are oral medications, and so the hope was that they would be used before TNF blockers that have to be injected or infused. Obviously, patients would prefer it that way to having oral medication, versus something that, where they have to get stuck with a needle. Many patients are going to end up seeing relief from the TNF blockers, so they won't have to end up going back and getting to try a JAK inhibitor, at least not initially. And so that's going to cause them to lose substantial potential sales.

Then to answer your question, could things get worse? I think the worst-case scenario would be that the FDA puts a restriction on the higher dose of the JAK inhibitors, because the lower dose has about equivalent to other drugs in terms of efficacy. But the higher dose has substantially better efficacy.

It's hard to see a patient getting a TNF blocker and then it not working, and then going onto a low level of JAK inhibitor. It's probably not going to work, too, since the low-level JAK inhibitor and the TNF blockers have about the same efficacy level. If the FDA decided that the patients shouldn't be taking the higher dose of the JAK inhibitors, I think it'd be a huge loss for the JAK inhibitors.

Brian Orelli, PhD has no position in any of the stocks mentioned. Keith Speights owns AbbVie and Pfizer. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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